Does Fair Trade mean only countries with similar standards of living can trade with each other?

[redqueen]

Does anyone REALLY believe this is a serious definition of fair trade?

[againes654]

1. Well hell no, but then again

I don't live in bush-world. (or do I......:hide: )

[redqueen]

2. Is that where that usage comes from?

Someone on another thread indicated that there are poeple using that definition here... and I found that somewhat shocking.

[againes654]

4. I don't know, but

it sounds stupid to me. :shrug: but what do I know?

[redqueen]

6. I was going to use 'asinine'

but stupid works just as well!

[pampango]

9. In the bush world they think that fair trade means trade with

other developed countries? I didn't think they had much use for the term "fair trade".

[againes654]

16. It's the fair part that gets them

They don't understand fair anything.

[BlooInBloo]

3. I assumed it meant there were carrots and sticks for countries that do/don't support....

... fair-ish labor/quality standards.

[redqueen]

5. Yeah... that's the definition

that everyone else I've ever talked to about it uses.

Where this other definition comes from I have no idea!

[BlooInBloo]

10. lol! Shows how much I know - I didn't even know there WAS another definition.

[redqueen]

12. Me neither! Apparently there's a new BULLSHIT one

being used to make people think fair trade is baaaaaad for third world countries.

:eyes:

[pampango]

7. I'll be interested to see the responses to this.

And whether many think that the lower level of wages in the Third World gives them an unfair advantage in their trade with the US, even with labor, environmental and human rights conditions included in our trade agreements with them.

[redqueen]

8. Did you ever remember who it was that used it this way?

Cause honestly... it's just nuckin futs! :P

[pampango]

13. It was in one of the Mexican trucking threads.

There are hundreds of posts in them, but I think I can find them.

[redqueen]

14. Eh, not that important.

I'll be happy with just making sure that BS doesn't gain any traction around here :)

[pampango]

20. Here's all I could find.

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x1790516 (post 38)

"Look at Mexico, look at China they are paler because they are less wealthy in an absolute sense. Trading between the top dogs(blue) and everything else results in the top being dragged down to the global average. This is not comparative advantage given equal inputs it is absolute advantage based on cheapness." - The poster is referring to a map which shows richer countries in darker colors (the richest are blue) and poorer countries in paler colors. He/she doesn't use the term "fair trade" just states that any trade with poorer countries drags the rich countries down, based on the absolute advantage in terms of cheapness that the poorer countries have.

There was a post on another thread making the point that fair trade was only possible between countries with similar standards of living and in the same geographic region - proposing the Central and South American would be such a zone and the US and Canada would be another. Though the poster used the term fair trade, it may not have been in the sense that we have come to define it here.

I eyes were getting blurry looking for the latter post and I have to get going. I look forward to checking the posts here later this evening.

[Lydia Leftcoast]

23. That was me in the second example, and I wasn't saying that

trade should be allowed only among countries with equal living standards.

I siad that free trade, as in goods and services and yes, people, moving freely across borders, should be allowed only among countries with equal living standards.

I never said that only countries with the same standard of living should be allowed to trade with one another at all. Anyone who claims that is some corporate-style "free" trade apologist who is setting up a straw man.

[redqueen]

26. That's what it seemed like to me...

Thanks for clearing that up! :hi:

[w4rma]

11. Tariffs when they differ. (nt)

[killbotfactory]

15. Hahahaha... no.

Some fair trade organizations allow workers in third world countries to profit fairly from their work, by bypassing the major global corporate predators altogether (and most of these companies have a disgusting amount of blood on their hands). When it comes to agricultural products like Coffee, fair trade also helps support family farms that are better for the environment, as opposed to corporate run farms where they tear everything up.

The ultimate goal of Fair Trade should be to end the race towards the bottom. We shouldn't allow US companies to just jump continents and get away with labor and environmental policies we would never tolerate in the US.

[redqueen]

17. Thank you!

I'm so glad to see so few seem to have fallen for that spin. :)

[Lex]

18. I don't think that is the correct definition of "fair trade."

So I don't think it is a serious definition of fair trade.

Fair trade is an organized social movement which promotes standards for international labor, environmentalism, and social policy in areas related to production of Fairtrade labeled and unlabeled goods. The movement focuses in particular on exports from developing countries to developed countries.

Fair trade's strategic intent is to deliberately work with marginalised producers and workers in order to help them move from a position of vulnerability to security and economic self-sufficiency. It also aims at empowering them to become stakeholders in their own organizations and actively play a wider role in the global arena to achieve greater equity in international trade.

Fair trade proponents include a wide array of international religious, development aid, social and environmental organizations such as Oxfam, Amnesty International, and Caritas International.

http://en.wikipedia.org/wiki/Fair_trade

[Elwood P Dowd]

19. Most of our trading partners operate under a totally different set of rules

In most of these so called "Free Trade" agreements, we have given our trading partners up to 15 years to lower their tariffs while we lower ours almost immediately. Also, most of our trading partners have a VAT (Value Added Tax) on imports from the US while we have no VAT on imports. The VAT often adds 10-30% to the price of the USA export even before tariffs are added. I recently sold an eBay item to a guy in Germany, and the VAT was over 20% even before the tariff was added. If he had shipped me that same product, there would not have been a VAT and the tariff would have been less than 5%.

A second major problem is wage levels along with lax or non-existent regulations on labor, consumer safety, and the environment you find in most third-world countries. They operate under rules and regulations that would never be tolerated in the US.

It's not free trade when you ship both labor and capital out of the US simply to take advantage of slave-labor wages and avoid all protections for consumers, workers, and the environment. It's not free trade when you allow your trading partners to charge you a VAT of 10-30%, while we have no such tax on their products.

NAFTA, GATT, WTO, GATT, and all the others were basically written by the corporations who stood to benefit the most. Many US corporations didn't want to move operations offshore, but were forced to in order to compete with those who did move.

[TreasonousBastard]

21. It means whatever whoever's arguing...

over it says it means. Terms like this are thrown out all the time for effect, although rarely really defined.

So much bullshit, so little time.

[Lydia Leftcoast]

22. No, but countries with the same standard of living make the most logical

tariff-free blocs.

The agricultural sectors of Third World countries can be hard hit by floods of U.S. agricultural products, and our industrial sector can be devastated by floods of manufactured goods made by Third World residents working 72 hours a week.

Some of the problems with the current system:

1) Third World countries provide raw materials and ag products, but don't have the wherewithal to process them, not even for their own use. For example, a country that grows cacao may have to import chocolate because it has no processing plants.

2) The race to the bottom. The XYZ Shoe Company moves production to China to gain an edge on the competition. The shoe factory workers, who used to earn a living wage, now make $8 an hour at WalMart or McDonald's--if they're lucky. They therefore cannot afford to buy any but cheap imported shoes. They also cut back on all non-essential purchases. The industries that they used to buy from--clothing, furniture, appliances--suffer a loss in sales and therefore cut costs by moving production to the Third World. The workers who used to earn middle-class wages making clothing, furniture, and appliances are also relegated to McJobs, so they, too, can afford only cheap imports, not U.S.-made goods.

Meanwhile, the "paper entrepreneurs," the people who spend their days at desks in front of computers buying and selling shares and financial products and negotiating mergers and acquisitions, become fabulously wealthy without producing anything except luxury for themselves and trouble for everyone else.

3) The IMF/World Bank model of "development" requires countries to produce cash crops instead of guaranteeing food production, to cut subsidies to city dwellers, and to reduce or eliminate social services.

4) No country has ever achieved equitable growth by following the recipe described in #3 or by giving free rein to the sweatshops. The often-cited examples of India and China actually show highly uneven growth: fabulous wealth for the few, a slightly larger middle class, and worse conditions for the masses, including the loss of the social safety net in China and debt slavery in India.

The Asian Tigers actually did eveything "wrong" according to the IMF/World Bank model. While they accepted some foreign investment (in the 1970s, half the clothes I bought seemed to be made in Taiwan or Korea), they kept it strictly under control and demanded technology transfers and the training of local people for managerial and technical positions. They placed tariffs on foreign goods. They spent huge sums on education and infrastructure and sent their brightest young people to the West to study. They imposed land reform. As a result, the East Asian countries are prospering with a level of income equality that is unknown anywhere else in the world.

(Interestingly enough, Japan had a high standard of living with income equality until it bowed to U.S. pressure and began "reforming" its economy by allowing cheap imports, allowing U.S. big box stores to come in, and encouraging a culture in which it's all right to cut costs by firing long-time workers.)

[Nederland]

24. Wow. I actually agree with you for once

I think your description of what happened with the Asian Tigers is spot on, and they present an excellent model of how to develop an economy. I wonder however if you realize that the only reason the Asian Tigers were able to do what they did is because the US did not impose high tariffs on their goods. As a result, the textile industry in the US pretty much died...

[Nederland]

25. Fair Trade

Fair trade means that each country engages in trade without "cheating".

Cheating means no subsidies to lower the price of your exports, and no tariffs to raise the price of your imports.